Tax Benefits & Consequences of Selling a Home

When you sell your home, you may see some tax benefits and consequences depending on your situation. For some, sellers may see tax breaks, and for others, they may have to pay more taxes. Here are some common tax benefits and consequences of selling your home:

You May be Eligible for Deductions & Tax Breaks

The great part of selling your home is that you may be eligible for a variety of deductions and tax breaks. For example, you may be able to take out property tax deductions from the part of the year you owned your home up to, but not including, the date of sale. Other deductions can include:

You May Have to Pay a Capital Gains Tax

Selling your home often doesn’t require you to pay taxes on any profit you make, also known as the capital gains tax. However, there are some rules regarding whether or not you are excluded from paying capital gains tax:

Profits from the sale must not exceed $250,000.

The home must have been your primary residence and owned by you for at least two of the five years prior to the date of sale.

You haven’t excluded any gains from a previous home sale in the two year period before the current sale.

As with all taxes, they can vary from state to state and change at a moment’s notice. It is highly recommended that you consult with your accountant or other trusted financial advisors to make sure you are eligible for any tax benefits.

The information provided on these posts have been prepared by a third party company and have been distributed for education purposes only. The positions, strategies or opinions of the authors do not necessarily represent the positions, strategies or opinions of Guild Mortgage Company or its affiliates. Each loan is subject to underwriter final approval. All information, loan programs, interest rates, terms and conditions are subject to change without notice. Always consult an accountant or tax adviser for full eligibility requirements on tax deduction.